The dollar index (DXY00) fell to a 7-week low today and is down by -0.10%. Easing geopolitical tensions in the Middle East are boosting stocks and reducing safe-haven demand for the dollar. Also, today's -6% plunge in WTI crude oil prices lowers inflation expectations and could prompt the Fed to loosen monetary policy, a negative factor for the dollar. The dollar recovered from its worst level after the July ISM manufacturing index rose more than expected to a 4-year high.
Dovish comments today from New York Fed President John Williams were negative for the dollar when he said interest rates remain well positioned as inflation should ease during the second half of the year.
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